Microsoft has been rather mum on exactly how many Surface RT and Surface Pro tablets it has sold since the tablets originally launched back in October of last year. However, a new form 10-K was filed by Microsoft with the Securities and Exchange Commission, and it gives us the best direct picture of how Microsoft is doing with its Surface line of tablets we’ve had so far. The form shows that Microsoft has made $853 million in revenue from the Surface tablet line.
That money covers June 30 all the way back to the launch date of the Surface RT tablet in October of last year. It also covers the time period from the launch to current for the Surface Pro tablet. The form only shows revenue generated and doesn’t shed any light on actual numbers of tablets shipped. Estimates are that Microsoft shipped about 900,000 Surface tablets during Q1 of 2013.
Surface RT and Surface Pro: A Closer Look
The Surface RT and Surface Pro tablets were Microsoft’s ambitious foray into the tablet market, aiming to compete with established players like Apple’s iPad and various Android tablets. The Surface RT, running on a version of Windows specifically designed for ARM processors, was targeted at casual users and students. It featured a sleek design, a built-in kickstand, and a detachable keyboard, making it a versatile device for both entertainment and productivity.
On the other hand, the Surface Pro was designed for professionals and power users. It ran a full version of Windows 8, allowing users to run traditional desktop applications. The Surface Pro was praised for its high-resolution display, powerful Intel processor, and the inclusion of a stylus, which made it a favorite among digital artists and designers.
Financial Implications and Market Performance
Microsoft previously revealed that it had taken a $900 million write-down due to a Surface RT inventory adjustment. This significant write-down was a result of unsold inventory, which led Microsoft to reduce the price of the Surface RT tablet. The cost of the 32 GB tablet was brought down to $350 within the United States, a move aimed at boosting sales and clearing out excess stock.
Despite the write-down, the $853 million in revenue indicates that there was still a substantial market interest in the Surface tablets. The revenue figure, however, does not provide a complete picture of the profitability of the Surface line. The costs associated with research and development, marketing, and production must also be considered.
Moreover, the competitive landscape of the tablet market posed challenges for Microsoft. The Surface tablets had to contend with the dominance of the iPad, which had a well-established ecosystem of apps and accessories. Additionally, the plethora of Android tablets offered consumers a wide range of choices at various price points.
Microsoft’s strategy with the Surface line was not just about immediate sales but also about establishing a foothold in the hardware market. The Surface tablets were part of a broader vision to create a seamless ecosystem of devices and services, integrating hardware with Microsoft’s software offerings like Windows, Office, and OneDrive.
via ZDNet
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